For government, it is not just size that matters

By Chrystia Freeland
October 4, 2012

Photo: Joshua Lott/Reuters

One of today’s major debates is how big government should be. Maybe we are asking the wrong question. Our battle over the size of the state overlooks a problem that is just as important and that may be easier to muster the collective will to resolve: how effective government is, regardless of its scale.

After all, even in this age of polarized politics, there is one thing right and left agree on: Government needs to get better. Diana Farrell, an economist who recently returned to the consulting firm McKinsey after a two-year stint in the White House, thinks smart pragmatists should seize this common ground.

“We see a massive opportunity in what is a meaningful part of GDP to make it work better,” Farrell, who leads the new McKinsey Center for Government, told me. “Whether you believe government should be 20 percent or 80 percent of GDP is a political choice. But once that has been decided, then assuring that that part which is government works – that can be apolitical, that can be managerial. That is what we are trying to do.”

One of the big shortcomings of government today is how clumsily it responds to the desires of its citizens. This is the 21st-century paradox: Even as political democracy has become the intellectual default mode for much of the world, the private sector usually trumps the public one when it comes to accommodating consumer choice. If you doubt that assertion, consider this question: Who offers you a better, cheaper service – Google or your post office?

James S. Fishkin is a communications professor at Stanford University and a contributor to a volume of essays on how to fix the state that Farrell’s center is publishing next week. In his piece, Fishkin suggests one way to give citizens a stronger voice. He argues that neither opinion polls nor town halls do the trick. Polls are too superficial – replies are based on respondents’ biases and the latest sound bites they have heard, rather than a careful study of the often-complex issues governments must decide. Town halls and other public forums do provide an arena for more nuanced debate, but they are subject to capture by those whose convictions are most intense.

Fishkin believes a better option is a technique he calls deliberative polling, a modern spin on Athenian democracy. Deliberative polling takes a representative sample of citizens and gives them the time, information and structure to learn about complicated problems. According to Mr. Fishkin, this process has been used about 70 times in 18 countries. Texas applied it in the 1990s to give the public a say in the use of renewable energy by regulated utilities; Zeguo township, in the Chinese city ofWenling, has used it to prioritize municipal infrastructure projects. (Thus consulted, the Chinese opted for clean water ahead of a fancy public square, to the surprise of their officials.)

The McKinsey collection is bursting with other good ideas: Peter Ho, formerly the top civil servant in Singapore, describes his country’s thoughtful techniques for coping with an increasingly unpredictable and complex world; Mohamed Ibrahim, the African cellphone mogul, identifies a lack of good data as the biggest obstacle to improving governance in his home continent; Matthew Taylor, chief executive of the Royal Society for the Encouragement of the Arts, Manufactures and Commerce, aLondon-based nonprofit, sees the sorting of different types of garbage that most of us now do in our own kitchens as the herald of a new and needed era of greater citizen engagement with the services the state provides.

The unifying idea is that we should focus on making government smarter, not arguing over whether it is too big or too small. The tactical elegance of this approach is admirable: In an age of ideological deadlock, it makes sense to find a way to sidestep that fight altogether. Even more compelling is the insistence that the state should be overhauled with the same rigor the private sector applies to efficiency and customer satisfaction. That rallying cry is long overdue.

But the appeal of this technocratic recipe is also its limitation. First, one small caution. Data and metrics are wonderful tools, but private-sector wonks who believe that their spreadsheets are the secret to fixing the government would do well to remember that the greatest economic disaster of our time was caused by the most data-oriented sector of society. Wall Street didn’t fail because it had too few quants, but because it had too many.

The larger caveat is that Farrell’s quest for apolitical improvements in government goes only so far. The truth, as Daron Acemoglu, an economist at the MassachusettsInstitute of Technology, points out in the most important essay in this collection, is that governing is an innately political act. It is absurd to campaign narrowly for a more efficient state while setting aside debates about what that state is for; some of the most evil governments in history – Hitler’s Germany, Stalin’s Soviet Union - were made worse by their efficiency, not better.

All of us can agree that we want government to work as well as possible, and we should all applaud efforts to improve it. But there is no escaping the divisive and essential questions: What is the purpose of the state and whom does it serve?

 

15 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

The whole point of Constitutional government is not to react to popular whims. It presumes to be a responsible institution that is capable of ordering the deaths of prisoners and the incarceration of felons. It has the enormous power to tax and to levy fines and even to confiscate property. It presumes to wield weapons and can order men to their deaths. It is a matter of life or death for many who depend on it or are who are opposed to it. For many it is the only thing like religion they possess. For many it is anathema to their religion.

Somehow – the image of a popularity or efficiency contest makes my blood run cold and the government would become the plaything of swindlers, con men and advertisers. Many think it’s there already.

As for who is a provider of a better service – Google of the Post Office. Try mailing a package using Google. For solid objects in real space there are Fed Ex, UPS or USPS and USPS is actually the cheapest and rather quick too.

Posted by paintcan | Report as abusive

“Who offers you a better, cheaper service – Google or your post office?”

I recently tried to ship a guitar via Google. It just sat there propped up beside my desk. I found Google to be totally unresponsive. The Post Office, on the other hand, got the job done.

Posted by flashrooster | Report as abusive

There is no “debate” over size or efficiency of the federal government in this country among “we, the people.” There is a never-ending argument between the dominant political parties whose ideological “platform baggage” has reduced voters’ “choice” to one of “bad” and “worse”. They do not ask, and do not care about what “we, the people” think once we give either our vote.

I don’t believe either party seriously intends to reduce the size or grasp of a federal government whose various components judge “success” by their budget and number of bureaucrats on the payroll. Our elections process has been reduced to sequential illusions…mass entertainment without substance or predictable effect.

You can’t debate how big government should be unless there is consensus as to what government should do. You cannot debate what government should do until there is agreement as to the sustainable revenues available to do what must be done.

But professional politicians have long known that so long as they can make the public believe that genuine progress or improvement in the role and process of government is impossible the “status quo” can be perpetuated indefinitely as will their “membership” in Washington. These are the ones that “we, the people” need to “send home” (fire, banish) FIRST! They have long abrogated their fiduciary duty to American taxpayers without penalty.

Just about everyone that is rational understands that “entitlement obligations” need to be reduced and our tax code revised, but “the Devil is in the details” as to whose “ox is being gored” by the process. Since present revenue is clearly too little to pay for what government is trying to do, greater or lesser efficiency in an unsustainable process is of little importance.

So yes, government needs to “get better”. But I find nothing less than frightening at Diana Farrel’s opinion that “Whether you believe government should be 20 percent or 80 percent of GDP is a political choice. But once that has been decided…”. Excuse me? That is a highly technical economic debate that should be a process of pubic education and it should be “we, the people” that make that choice an informed one.

Yes, government today is clumsy; but the founding fathers intended it be so for our own protection. And yes, I like Google a whole lot better than our unionized Post Office’s “standard of service”. I do not trust the hand of government unilaterally making health care decisions at the individual level.

I would like the idea of “deliberative polling” more if it were not relatively easy to rig by those in charge. I would prefer to see the California system of Initiative and Referendum enacted across all these United States.

Is it perfect? No. Is it fair? Not always. Can it be manipulated? Yep. Is it an improvement to existing “citizen participation” elsewhere? Without the slightest doubt it is the sole process that gives John Q. Public a reasonably level playing field on big dollar choices.

I don’t want a “smarter” government because if you send an idiot to college all you get is an educated idiot…something much more dangerous to our society than the original simpleton. What we need instead is a smarter electorate, one capable of national dialog, debate and eventual consensus as to what kind of country we need. Notice I said “need”, not “want”.

America is a rich and prosperous country that can well afford it’s needs. But no country in the history of the world has been rich enough to give it’s people everything it’s people want (or think they “deserve”).

We must, once and for all, replace the prevailing political and governmental mind set that “if we spend it they will pay”. Until “we, the people” define America’s needs, and force our “representatives” to prioritize AVAILABLE funds such that these are met within said funds, there is NO LIMIT to the size of our government and NO LIMIT to the financial resources it will seek to control.

Posted by OneOfTheSheep | Report as abusive

I worte – “ordering the deaths of prisoners”. I heard this from a guy I once knew who spent some time in a country jail. The prison system of this country apparently had (has?) rules on their books that permitted the Warden to order the summary execution of any (or all?) prisoners they deemed a threat to public welfare in time of national disaster. That is a very wide open definition if there ever was one, starting with the word “disaster”, and right after that, “threat”.

I have no idea if that is still true or how to find out.

It is obvious that our own system, in many ways, was not much “nicer’ than many of those in the ME we claim are so barbaric and dictatorial. And we seem to be bound and determined to make their lives harder for a variety of dubious reasons.

@OOTS – even referendums can be abused as you say and everything depends on the ‘definitions”. Even Clinton’s, what is the meaning of “is”, was just one of the simpler conundrums. The ACA bill, that I actually tried to read through, exhausted me after 200 pages of definitions alone and they weren’t trying to be obscure. You really need a legal education to understand the language and there is no simple or user friendly substitute for those terms either.

And that would be the problem with referendum legislation. You over estimate the patience and knowledge of “WE the People”. They vote reps to do that for them and those reps have bigs staffs because they can’t quite all handle the required reading either.

And “WE the People” isn’t a nation of drones. “WE” never sees anything as one. It’s frightening to think “We” ever could. Monarchs always claim “He” or “She” is “We” or “Us”. It’s charming, but they always manage to alienate a whole lot of “Them” whenever they get too narrow minded or stressed. “WE” can never completely figure out who “We” really is.

Posted by paintcan | Report as abusive

@paintcan,

I have come too believe that the primary difference in our perspectives is that you allow yourself the luxury of considering some non-existent theory of perfection as an available, and therefore find everything real in the “here and now” as unacceptably lacking. It’s certainly your right to do that, but does this not rather predictably leave you in perpetual and frustrated bitterness because NOTHING is as you think it “should be”?

I haven’t had a “legal education”, but I read the “fine print” a lot more than most. I discovered I could not take the Volkswagen Bug I financed to Las Vegas from California (out of state) without written permission; and observed that by their day-to-day lack of enforcing that requirement it was functionally waived for one and all.

In the United States we debate the lawfulness of capital punishment and whether we need two or three drugs in our “lethal cocktail” to provide a “humane death. In the middle east beheading is common and frequently so swift that there is no functional appeal. While on occasion western society convicts and incarcerates an innocent man and encourages “redemption”once one’s sentence is served, in the middle east they cut off the hand of the accused thief and stone people rumored to be adulterers to death. I’m rather sure of you spoke with one who has personally experienced the above “justice” they would deem “our system” VERY MUCH “nicer”.

You express legitimate concerns about what obviously are contingency plans for a prison Warden. How many prisoners have been executed in the many years such rules have been on the books? NONE. If the choice were to see the prison population suddenly free to again prey on the society that locked them away, to “settle accounts with victims, witnesses, prosecutors and judges one an all, I think I’d rather the Warden follow the rules if it ever comes to that.

Our nation’s “system” is utterly dependent upon an informed electorate to make it work. In a time that alien beings visiting Earth might long debate whether or not there is intelligent life here if they watch us for a while, I like the “Inititive and Referendum” system, for all it’s warts and potential for abuse, to the absence of same.

Posted by OneOfTheSheep | Report as abusive

Regarding Google versus the USPS please recall that the Internet was developed by DARPA, which was funded by the government. Not to mention that so much of our modern tech world is a direct outgrowth of government support of research through agencies like NSF, NASA, DOE, DOD, and NIH.

Posted by dennisr48 | Report as abusive

@Oneofthesheep
I think you’re thinking about this in the wrong way (although some of your conclusions are still disturbingly true). For instance, when you say, “You can’t debate how big government should be unless there is consensus as to what government should do. You cannot debate what government should do until there is agreement as to the sustainable revenues available to do what must be done.”, I think you have it backwards. Governments didn’t exist because people had substantive discussions about them, they existed precisely to do something practical. They existed to put up the barn, put out that house on fire, arrest that guy who stole something, or go to war with the neighboring tribe, etc. Truly at some point (even up until Rome before the Emperors) it WAS, “don’t ask what your country can do for you, ask what you can do for your country”. It’s been hijacked by all sorts of agendas and groups, not the least of whom are lobbyists and politicians, but it IS “we the people”. The real problem is that there may be a substantive
limit on how many people can be governed (probably also dependent on factors such as racial makeup, social custom, tribe affiliation, etc.) and how egalitarian that government can be given the size of the population it has to govern. For instance totalitarian regimes can govern large numbers even with a fairly volatile social/tribal mix but only under fairly dire conditions. Improve the conditions and you see the volatility rise (China for instance). Our form of democracy may just have an absolute limit on who can be governed effectively. For instance both Britain and Switzerland have long had democratic governments but with low and homogenous populations, add in Scots, Irish, mid-easterners and Indians and you get volatility again. Perhaps the real solution is to break up the country into smaller groups of states, say the New England states, the Southern states, Texas could go to Mexico or remain independent, the Mid-Western states, the Western states and everything on the Pacific coast. We migth get better governance then simly because of fewer people and more people with the same social/tribal outlooks.

Posted by LAN8 | Report as abusive

So if the question is not size, but how effective government operates, who better to address that problem than Romney with real-world experience?

Posted by ponder | Report as abusive

Government will grow as more dangerous things there to regulate we need regulate things like building, highways, drugs, etc. But if it is for special interest it will not work only tax. An example is we pay more for education per pupil than almost all nations but our pupils score way down on tests. They run for the unions and patronage. No CEO goes to jail when nuclear safety tests falsified, in fact no executive did.

Posted by Samrch | Report as abusive

Government can’t really know how to do better unless it knows better what it should be doing in the first place.

For example, Medicare is actually very good at what it does, with administrative costs that compare quite well to its private sector brethren. But what it does is only partly right, as it has certainly contributed to the perpetuation of the fee for service business model in U.S. healthcare, which, in turn, according to the Institute of Medicine, results in wasting 30 cents of every dollar spent.

The current U.S. political system, influenced too heavily by campaign fund raising, is not really capable of thinking seriously about what Medicare should be doing differently. We might well get better care at a lower cost, but money-amplified voices shape the debate in their terms.

Perhaps McKinsey could give some thought to improving the U.S. system of voting, both to adopt modern methods like those used in other advanced countries and to do serious study of what discourages Americans from participating.

If Americans could believe that their voices were actually heard in the decisions about what government does, it would be much easier to address opportunities to improve the effectiveness of government.

Posted by dsandahl | Report as abusive

@LAN8,

Backwards or forward, you have to “have a plan”. Before our Constitution and all it’s amendments our founding fathers came up with out Declaration of Independence. Even they had such difficulty with pulling together the funds to “run” a relatively tiny country that their unit of printed currency became a joke in the expression “Not worth a Continental”.

NEW governing systems always arise out of substantive discussion. Only a substantially NEW and clearly defined set of “missions” (and appropriate tax funding of same) from a people again determined to take charge of their own future has a ghost of a chance of ending the present incessant squabbling between competing interests over a “national purse” full of IOUs.

If we split our government into the two most fundamentally different groups, you get the “workers” who pay all the taxes and the rest, generally along “blue” state and “red” state divisions. One, in essence, funds the whole country; and, therefore SHOULD have final say as to how it should be governed.

This relatively recent idea that everyone gets a “seat at the table” by accident of birth without having to go out and earn it in some form or fashion every day, like a good reputation, is as silly as it is proving unworkable. Even Congress cannot be trusted to give themselves raises!

Posted by OneOfTheSheep | Report as abusive

Our government is very responsive! To big money – not its citizens, that is. Red and Blue, left and right, conservative and liberal had better get their act together and see the simple truth: All the devisiveness going on is a very simple divide-and-conquer strategy by the ultra-rich and large corporations. We are so dumb. I have lost hope in ordinary people. They all watch TV like it’s the truth or something dumb like that. Big corporations own TV programming.

Posted by possibilianP | Report as abusive

An interesting piece, the main point of which I’ve been trying to impress on people for years. I’ve generally phrased it as “It’s not so important how much the government spends as it is what they spend it on.” Not nearly as eloquent as your double entendre title. I see several immediate issues with Ms. Farrell’s optimism. First the idea that the nearly infinitesimal minority of “smart pragmatists” can actually accomplish anything in the incredibly partisan political situation of today’s America I find somewhat akin to placing hope in the tooth fairy. I know quite a few people who I would consider to be rather intelligent, however, the ones I would consider “smart pragmatists” could be counted on fewer than half the fingers of one hand. Farrell actually compromises her own plan by suggesting that “Whether you believe government should be 20 percent or 80 percent of GDP is a political choice.” I would argue that pragmatism would be very useful in making this decision. And while many may agree in principle very few would use even the slightest bit of pragmatism in actually making the decision. This, I believe, is at the crux of the problem. Political ideology has supplanted religious dogma in commandeering the minds of those who are either incapable of or unwilling to do the hard work required to make rational decisions.

Mr. Fishkin’s suggestion of course suffers the same problem. The problem is that of assuming a rational actor. Farrell should be well aware of this issue as it’s received much attention in economics lately with the advent of the field of behavioral economics. It turns out that people don’t always act in their own best interests. It would seem that expecting them to act in the best interests of the community is a bit of a stretch, informed or not. Having read Fishkin’s piece in The Economist a few months back, I’m still not convinced that his proposal addresses this problem.

In my experience providing information about complicated problems to an ideologue is about as productive as reading philosophy to your dog. Recent research (I apologize for not remembering the source at the moment) seems to indicate that information contrary to one’s opinion can actually make people more steadfast in their position, the exact opposite of the intended purpose. If you doubt me just try using the mountains of data available to convince a die-hard conservative (or libertarian) that socialized medicine as practiced by many developed countries is both more efficient and effective than the market based system employed in the US, or try using data and reason to convince a die-hard liberal that the unintended consequences of taxing corporate profits lead to results that contradict their own principles. In the first case you’ll be condemned as a socialist, a liberal or a Europe lover (why don’t you move there if you like it so much? is the typical adolescent retort), the best you can hope for in return is a pathetic argument about the failure of Europe (neglecting the data, of course, that the 3 worst off out of the 5 PIIGS (Ireland, Spain and Greece) all had total public spending as a share of GDP at or below the OECD average for the years 2004-2007 and all five had spending lower than Finland, Austria, Denmark and Sweden, all of which appear to be doing quite well in light of the global situation), a failure which, in the mind of the ideologue has somehow been exacerbated by paying half as much for healthcare as the US. Of course you won’t fare much better trying to explain the dangers and general foolishness of taxing corporate profits to your liberal friend. You’ll likely be accused of being a corporate shill (even if you’re retired) or an ignorant patsy for evil big business. You’ll likely discover in both cases that, despite having quite obviously established a very strong opinion on the subject, your counterpart has essentially no knowledge of the topic whatsoever. It’s very similar to trying to explain evolution to a fundamentalist Christian, a chore that I gave up on long ago.

A few other points about the article. The comparison between Google and the USPS was just bad and the article would have been better off without it, shame on your editor. Though it’s not exactly an analogy it would benefit from one of the rules regarding them, that is where you see the similarities your readers see the differences. The differences in this case are so overwhelming that your point (whatever that was) was lost in the absurdity of it. And Wall Street didn’t fail because it had too many quants. Of all the entities to blame that one should be far, far down on the list, if it made the list at all. As catchy as the phrase may be, it’s just not true.

Thanks for pointing out the McKinsey collection, I look forward to reading it. It should be interesting to see how Mo Ibrahim “identifies a lack of good data as the biggest obstacle to improving governance in” Africa. I’m a big fan of data (if you hadn’t noticed) but the nations of Africa have far more fundamental issues than a lack of good data. I’m also interested in Acemoglu’s essay as I enjoyed his most recent book though I do have to say that I thought Francis Fukuyama’s “The Origins of Political Order” was significantly clearer and more compelling.

Posted by jtfane | Report as abusive

This discussion talks in circles. It actually is not the size of government as much as what do we get and how much does it cost. The bureaucrats feather their nest with expounded on regulations because they need to justify their existence – we allow it due to a perception that we benefit not necessarily that there is a benefit. Our military expands due to similar perceptions.

The entitlements are the largest part and become larger because we want them to. We either see the benefit directly or believe we will eventually.

This generosity is allowed because as a country we do not pay for it completely – the cost is hidden by an ever expanding debt. The hidden nature will change by demands from the lenders and when it does how big will we want our government to be and what will we want it to do now that the real costs are apparent. Better still what will our creditors allow – ask Greece, Portugal, Ireland, Iceland, Spain, et al.

Posted by keebo | Report as abusive

I wanted to comment on your article in the NYT (I followed the link at the end of that article to this point). The strength of your article was its recognition of the dynamic unity of opposites (Venetian plutocrats taking measures to defend their wealth that ultimately undermined their wealth) and the object lesson for America’s 1%.

Venice is an interesting case because it was founded by people fleeing the barbarians pillaging the mainland of Northern Italy. They settled in previously uninhabitable mud islands and built a glorious empire based on pluck, ingenuity, and trade with the advanced cultures of the East. Their decline was not just the result of internal causes but more fundamentally due to the rise of Spain, Portugal, and the Ottoman Empire.

Your reference to egalitarianism in early 19th Century America fails to mention the companion opposite: ante-bellum slavery. Jefferson himself (who you cite) wrestled with this for a lifetime. He was confronted with the very personal challenge of freeing his own children by Sally Hemmings (his deceased wife’s half-sister).

The land grab of the Mexican-American War (which was instigated by southern slave-owners in 1846-47) brought about an expansion of territory that made the Civil War and the end of slavery inevitable.

Lincoln vacillated and the North suffered from irresolute military leadership for the better part of two years before he adopted the clear-sighted strategic vision of the outcast John Brown – free and arm the slaves.

The man who arrested and oversaw the execution of John Brown, Robert E. Lee, saw his ancestral home, Arlington, turned into a national cemetery for those who lost their lives while marching to the tune of John Brown’s Body.

Be consistent in your recognition of the dialectic. I don’t think the solution lies in a return to a happy idyll which never existed in the first place.

Heidi Ewing documents the tragic decline of Detroit in her recent film, Detropia. Her call for a resurgence of entrepreneurs for a return to better days echoes a similar misplaced, Utopian sentiment.

As Karl Marx described it – revolution comes when the (private property) relations of production serve as an insurmountable fetter on the further development of the forces of production. Now that’s a more clear-sighted appraisal of the underlying contradictions… and it was first articulated in 1848.

Posted by hillhous | Report as abusive